Keynote Address By Mr Calvin Phua, Deputy Secretary, Singapore Ministry of Law at Marrakech International Justice Conference, Morocco

22 Oct 2019 Posted in Speeches

Modernisation of the Business Legal System - Singapore’s Experience

1. I would like to thank the Morocco Ministry of Justice for inviting me to speak at the 2019 Marrakech International Justice Conference. It is my pleasure to be here at this conference, and be part of the panel to discuss the “Modernisation of the Business Legal System”.

2. I would like to share how Singapore has created the conditions and developed the legal framework to support international business and investment.

3. First, let me touch on the importance of a trusted legal system to support businesses and protect investments.

4. Singapore is a base for international businesses. There are over 37,400 international businesses set up in Singapore, of which over 4,200 are set up as regional headquarters. They cover a wide range of industries, from aerospace, consumer business, creative industries, medical technology, to professional services, urban solutions and sustainability.

5. Businesses value the connectivity, predictability, long-term stability, commitment to the rule of law and international expertise that they can find in Singapore. Over the years, we have built up a sound and comprehensive system of rules, laws and agreements, and become a trusted base for many businesses.

6. Singapore is a small country. We have no hinterland and no natural resources. When we gained independence in 1965, we made two important decisions. First, we decided to have an open economy, even though this was sharply at odds with the conventional economic wisdom.

7. At that time, many developing countries feared exploitation of local labour by foreign capital. They chose import-substitution and protectionism. Our pioneer leaders made a different call. We chose export-led industrialisation and to open our doors. We welcomed foreign investments and worked with them to create growth and jobs for our people.

8. Second, we decided to run our country based on the rule of law. Our migrant population came from different shores. They were of different races and religions. The rule of law allowed us to build a fair and just society and to galvanise our people to work together and make this place home.

9. Rule of law also helped us to draw in investments. With an open economy, foreign businesses are able to invest. With the rule of law, they are willing to do so. The rule of law ensures a transparent and stable business environment, where contracts are enforced, disputes are resolved efficiently and fairly, and investments are protected.

10. Singapore continually reviews our legal framework, to keep it modern and business-friendly. We keep abreast of commercial developments and international best practices in the knowledge that law, like the businesses it protects, does not stand still. With supportive government policies and a pro-business environment, international parties seeking to resolve commercial disputes in Singapore can expect laws that are responsive and keenly attuned to their needs.

11. Our efforts have led to some success. The World Bank Doing Business Report 2019 ranks Singapore first globally in contract enforcement.This measures the efficiency of a judicial system in resolving commercial disputes.

12. Singapore law is increasingly being adopted as the neutral governing law for transactions with little or no connection to Singapore.The reasons are as follows: Singapore Law is transparent, neutral and predictable. Singapore law benefits from its roots in the English common law, which means it is familiar to many multi-national businesses. Businesses choose Singapore Law to tap into a legal system, which is familiar, yet modern and relevant, a system which has earned their trust. It is also cheaper, as the legal costs in Singapore are generally lower than in London and New York.

13. There is still much that we need to do, to develop our legal framework to support modern business needs. I will touch on 3 areas we have been working on, namely: developing Singapore as a hub for dispute resolution, with a comprehensive suite of international commercial dispute resolution services; adhering to and promoting international and multilateral commercial law treaties; and leveraging on technology to keep up with modern business needs.

14. Singapore has an open regime where parties are free to choose from a wide range of alternative dispute resolution options.

15. Singapore International Arbitration Centre (SIAC) was set up in 1991. Over the past decade, its caseload has grown by more than fivefold. In June 2018, SIAC was ranked the 3rd most preferred arbitral institution in the world, and most preferred arbitral institution in Asia, by the prestigious Queen Mary University of London and White & Case International Arbitration Survey.

16. Parties choose to arbitrate in Singapore because of our modern and responsive laws, and our open arbitration regime where parties are free to engage lawyers and arbitrators of any nationality and use any governing law.

17. In 2014, we set up the Singapore International Mediation Centre (SIMC) to provide international commercial mediation services to Parties who desire a confidential, time efficient and cost-effective dispute resolution process.

18. Given that mediation involves a neutral third party – the mediator – facilitating discussions between the disputing parties to work out a mutually acceptable solution, it is suited to accommodating cultural, legal and commercial differences between parties, while preserving party autonomy and business relations.

19. The Singapore International Commercial Court (SICC) was officially launched in 2015. It is a division of our High Court, and it offers parties specialist international judges and an efficient and flexible process for dealing with cross-border cases, including those governed by foreign law.

20. We also built the first integrated dispute resolution complex in the world, Maxwell Chambers, dedicated to hearing international commercial disputes.

21. This has received some international recognition. International dispute resolution institutions located in Singapore include the Permanent Court of Arbitration, the International Court of Arbitration of the International Chamber of Commerce, the American Arbitration Association - International Centre for Dispute Resolution, and the World Intellectual Property Organisation Arbitration and Mediation Centre. In addition to housing dispute resolution institutions, it also houses top barristers chambers and law firms from around the world.

22. At the same time, Singapore adheres to international commercial standards, and has ratified many international multilateral commercial law treaties, including the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, and the Hague Convention on Choice of Court Agreements

23. The Singapore Convention on Mediation, which is a United Nations Convention on International Settlement Agreements Resulting from Mediation, represents the missing piece in the international enforcement framework. Singapore supports the Convention because we see value in the benefits that it will bring for mediation and international commerce.

24. The strong support for the Singapore Convention shows that countries recognise the importance of having international rules-based mechanisms to deal with disputes, and the relevance of mediation as a useful means for international commercial dispute resolution. We welcome more countries to sign the Convention. I would be happy to meet up with delegations who are interested to find out more.

25. Next, I will talk about Singapore’s efforts related to legal technology. To keep up with modern business needs, we are leveraging new technologies and other innovations. For example, Singapore’s courts aim to develop a modern, “paperless” court system. Recently, we launched the electronic filing system (EFS), to allow lawyers to file court documents electronically from the comfort of their office or home, and enable open court and chamber hearings to be conducted in an electronic environment using electronic instead of paper documents. The filing system also enables lawyers to serve documents on one another at the touch of a button. We are also taking active steps to train a future generation of lawyers competent in technology.

26. The Singapore Law Society did a survey in 2018 to get a better understanding of the law firms’ views and concerns. The survey results showed that the top 3 obstacles our law firms faced were: (i) the lack of capital for tech investments; (ii) the lack of knowledge on how to incorporate tech into their businesses, and (iii) the lack of understanding of the value of technology.

27. To address these findings, we rolled out various measures to help our law firms, especially the small law firms

28. We raised awareness amongst our legal sector on the importance of innovation through technology, through AI workshops.

29. We provided support for law firms to identify gaps in internal processes, and recommended suitable technologies to address them.

30. We launched “Tech-Start for Law” in 2017 to encourage adoption of basic technology solutions for practice management, document management and online legal research. By pre-curating a suite of tech solutions and providing funding support, the scheme helped overcome two main hurdles that smaller law firms faced in adopting technology, namely, a lack of expertise in identifying suitable technology products, and high initial cost of tech adoption.

31. This year (2019), we launched “Tech-celerate for Law”. This is a step-up from “Tech-Start for Law”. The goals are similar to “Tech-Start for Law”, but include sophisticated solutions such as the use of AI in the provision of legal services.

32. I hope you have found this useful, and I look forward to our discussion. Thank you.

Last updated on 22 Oct 2019